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The effect of neighbourhoods and school quality on education and labour market outcomes in South Africa

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  • Asmus Zoch

    () (Department of Economics, University of Mannheim)

Abstract

This study evaluates the relative importance of family, neighbourhood and school quality in explaining variation in standardized test results, reaching and passing matric, university attendance and labour market earnings. It adds to the literature, by using a spatial approach to link a neighbourhood wealth index from the Census 2011 community survey to a unique administrative school data set from the Western Cape. For the long-term perspective the household and school information from the National Income Dynamics Study are explored. The results from administrative school data show how student wealth and differences in school quality produce vastly different outcomes for a cohort of grade 6 to 12 learners in Cape Town. It shows how grade 6 children going to the richest 20% of all schools are 30% more likely to pass matric in time, furthermore by grade 9 the learning gap is approximately four grade-levels worth of learning in comparison to children going to the poorest 20% of schools. However, this study also demonstrates that even children from the poorest neighbourhood would perform well if they go to one of the richest 20% of schools. Yet, given the limited number of quality schools, the segregated location of quality schools, financial as well as transport constraints, only very few children from the poorest 60% actually attend a top quintile schools. These results can be replicated for the national data set and show that in order to achieve more equal education outcomes, the quality of schools in the poor neighbourhoods have to be drastically improved. In addition, using the new school wealth index as an instrument for school quality, there seems to be a significant premium for quality education in labour markets earnings regressions, which show the long-term implications of the schooling system.

Suggested Citation

  • Asmus Zoch, 2017. "The effect of neighbourhoods and school quality on education and labour market outcomes in South Africa," Working Papers 08/2017, Stellenbosch University, Department of Economics.
  • Handle: RePEc:sza:wpaper:wpapers284
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    File URL: https://www.ekon.sun.ac.za/wpapers/2017/wp082017/wp082017.pdf
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    References listed on IDEAS

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    1. Servaas van der Berg, 2006. "How effective are poor schools? Poverty and educational outcomes in South Africa," Working Papers 06/2006, Stellenbosch University, Department of Economics.
    2. Nicholas Spaull & Janeli Kotze, 2014. "Starting Behind and Staying Behind in South Africa: The case of insurmountable learning deficits in mathematics," Working Papers 27/2014, Stellenbosch University, Department of Economics.
    3. Anne Case & Angus Deaton, 1999. "School Inputs and Educational Outcomes in South Africa," The Quarterly Journal of Economics, Oxford University Press, vol. 114(3), pages 1047-1084.
    4. Nicola Branson & Clare Hofmeyr & David Lam, 2014. "Progress through school and the determinants of school dropout in South Africa," Development Southern Africa, Taylor & Francis Journals, vol. 31(1), pages 106-126, January.
    5. Boccanfuso, Dorothée & Larouche, Alexandre & Trandafir, Mircea, 2015. "Quality of Higher Education and the Labor Market in Developing Countries: Evidence from an Education Reform in Senegal," World Development, Elsevier, vol. 74(C), pages 412-424.
    6. Lam, David & Ardington, Cally & Leibbrandt, Murray, 2011. "Schooling as a lottery: Racial differences in school advancement in urban South Africa," Journal of Development Economics, Elsevier, vol. 95(2), pages 121-136, July.
    7. Tor Eriksson & Yingqiang Zhang, 2012. "The Role of Family Background for Earnings in Rural China," Frontiers of Economics in China, Higher Education Press, vol. 7(3), pages 465-477, September.
    8. Gary Solon & Marianne E. Page & Greg J. Duncan, 2000. "Correlations Between Neighboring Children In Their Subsequent Educational Attainment," The Review of Economics and Statistics, MIT Press, vol. 82(3), pages 383-392, August.
    9. Oddbjørn Raaum & Kjell G. Salvanes & Erik O. Sørensen, 2006. "The Neighbourhood is Not What it Used to be," Economic Journal, Royal Economic Society, vol. 116(508), pages 200-222, January.
    10. Cheti Nicoletti & Birgitta Rabe, 2013. "Inequality in Pupils' Test Scores: How Much do Family, Sibling Type and Neighbourhood Matter?," Economica, London School of Economics and Political Science, vol. 80(318), pages 197-218, April.
    11. Servaas van der Berg, 2007. "Apartheid's Enduring Legacy: Inequalities in Education-super- 1," Journal of African Economies, Centre for the Study of African Economies (CSAE), vol. 16(5), pages 849-880, November.
    12. Servaas van der Berg & Cobus Burger & Ronelle Burger & Mia de Vos & Gideon du Rand & Martin Gustafsson & Eldridge Moses & Debra Shepherd & Nicholas Spaull & Stephen Taylor & Hendrik van Broekhuizen & , 2011. "Low quality education as a poverty trap," Working Papers 25/2011, Stellenbosch University, Department of Economics.
    13. Stephen Taylor & Servaas van der Berg & Vijay Reddy & Dean Janse van Rensburg, 2011. "How well do South African schools convert grade 8 achievement into matric outcomes?," Working Papers 13/2011, Stellenbosch University, Department of Economics.
    14. Hunter, Mark, 2015. "Schooling choice in South Africa: The limits of qualifications and the politics of race, class and symbolic power," International Journal of Educational Development, Elsevier, vol. 43(C), pages 41-50.
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    Cited by:

    1. de Kadt, Julia & van Heerden, Alastair & Richter, Linda & Alvanides, Seraphim, 2019. "Correlates of children’s travel to school in Johannesburg-Soweto—Evidence from the Birth to Twenty Plus (Bt20+) study, South Africa," International Journal of Educational Development, Elsevier, vol. 68(C), pages 56-67.

    More about this item

    Keywords

    South Africa; Education; Spatial analysis; Neighbourhood effects; Family effects;

    JEL classification:

    • D10 - Microeconomics - - Household Behavior - - - General
    • I24 - Health, Education, and Welfare - - Education - - - Education and Inequality
    • I26 - Health, Education, and Welfare - - Education - - - Returns to Education
    • J15 - Labor and Demographic Economics - - Demographic Economics - - - Economics of Minorities, Races, Indigenous Peoples, and Immigrants; Non-labor Discrimination

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